HC: Will Hiranandani construct low-cost homes in Powai?

The Bombay high court is set to decide on petitions accusing Hiranandani Developers Pvt Ltd of converting an affordable housing scheme in Powai into an upmarket housing project.

mumbaiUpdated: Dec 16, 2011 01:38 IST

Kanchan Chaudhari

Hindustan Times

The Bombay high court is set to decide on petitions accusing Hiranandani Developers Pvt Ltd of converting an affordable housing scheme in Powai into an upmarket housing project.

The builder had entered into a tripartite agreement with the Mumbai Metropolitan Region Development Authority (MMRDA) and the state government in 1986 to develop 92.93 hectares of land under the Powai Area Development Scheme to build small, affordable flats for low-income groups.

A bunch of public interest litigations (PILs), including one by social activist Medha Patkar, however contend that instead of constructing homes of 40 and 80 square metres (sqm), Hiranandani joined adjacent flats and built several homes admeasuring 400 to 500 sqm, which pushed their market value beyond the reach of low-income groups.

A division bench of chief justice Mohit Shah and justice Roshan Dalvi on Thursday sought to know if the developer is willing to build affordable homes on the remaining portion of the land, which is about 4.30 lakh sqm. Hiranandani is likely to respond to the court query on Friday. Its counsel Shrihari Ane said the practice of amalgamating flats is common and is usually permitted by planning authorities on paying a premium.

After receiving complaints, the MMRDA formed a six-member committee in 2007, and on the basis of its report, slapped a penalty of Rs1,993 crore on the developer in 2009. The amount was subsequently reduced to Rs304 crore, and then to Rs89 crore in January 2010, by when Hiranandani invoked the arbitration clause, and justice (retired) Arvind Sawant was appointed as the sole arbitrator. In August, justice Sawant gave a clean chit to the developer, following which Niranjan Hiranandani filed a plea seeking dismissal of the PILs pending for the last three years. The court has taken up the PILs for final hearing.